Who Is Responsible for the Inequality in the Education System?07.03.2016

Anyone who knows even a little bit about the issues in the education system’s budgeting allocation is aware of the fact that it suffers from substantial inequalities (although some may not consider it “suffering”). Who is responsible for the inequality? The debate regarding inequality in resource allocation is important, because the budget allocation policy can be a powerful tool for narrowing educational and scholastic gaps between pupils (although in my opinion, the central problem is inequality in educational and scholastic achievements).

This document relates only to the budget side of the formal education system. We will not relate to higher education because of the conflicting social influences in the number of college students (the greater accessibility on the one hand and the larger personal expenditure on the other),[1] and we will not relate to expenditure on building and equipment or the purchase of school books.

The education system’s budget for primary and secondary school is done mainly through four agents:

Government (primarily – although not exclusively – the Ministry of Education)

Local authorities

Non-profits and charitable foundations

Parents

In 2011, before the implementation of the Compulsory Education for Ages 3-4 Law, the picture as presented in the last press release of the Central Bureau of Statistics was as follows:[2]

What can we learn from this? Well, there are several things that we can take away from this table.

The heaviest part of the formal education system financing burden falls on the government. Local authorities participate in financing on the order of 6 to 7 percent.

Local authority participation in funding the education system declines as pupil age increases.

And in more detail:

The extent of local authorities’ expenditure for administration and operating expenses of the local education system hovers at around NIS 600 million. What is this expenditure earmarked for? The main part of this spending is on its administration and management, another portion is for salaries of local authority workers who are only for the most part funded by the government like psychologists and school social workers. This expenditure has a marginal influence on inequality in the education system, although it could be said that more professional administration and improved support services help the system. The question that needs to be asked, though, is how much larger is this expenditure in the more affluent local authorities?

With regard to preschool education, the data from the press release (that relates to 2011) regarding household expenditure are no longer relevant due to the decision to implement fully the law of free compulsory education for 3-4-year-old children. In addition, in light of the Ministry of Education budgeting rules that place 13 percent of the salaries for preschool assistants and the extra expense of running preschools even if there are only a small number of children on the local authorities, the estimate of 15 percent of overall expenditure probably reflects the reality (an expenditure of NIS 830 million). This expenditure is similar in all preschools irrespective of differences in pupil background and so this spending has no influence on inequality.

In primary education, the main burden falls on the government (93 percent); local authorities cover between 5 and 6 percent. This amount is for the total expenditure and not just for teaching related expenditures. This figure matches research findings based on an audit of the use of working hours performed for the Ministry of Education (Blass, Zussman and Tsur, 2010). Thus, even if in certain places and certain educational institutions the expenditures of the local authorities on education can have substantial impact (Tel Aviv is the most striking example – although it should be remembered that Tel Aviv applies affirmative action policies), all in all, the influence of local authorities on inequalities in allocation is not great.

The most surprising figure is from the secondary schools where the local authorities contribute between 2 and 3 percent of funding. This is surprising since it is commonly thought that the local authority contribution at this education level is higher. It turns out that that is not the case, primarily due to the fact that the majority of schools are not run by the local authorities even though many belong to the non-profits and educational networks that get their budgets directly from the Ministry of Education. Here, too, it is very possible that in certain places the picture is different (places like Omer, or the district authorities where there are few pupils who are bussed for long distances) although in general, here, too, the influence of the local authorities on inequality in allocations is small.

A surprising figure is the household share in the expenses for education, although this figure should be examined in light of the fact that a large portion of expenditures included in secondary school education do not relate to it.[5] In any case, the subject of household participation has no influence on the way that local authorities deal with inequalities in allocation.

A separate analysis of the local authorities’ budgets indicates that in 2012 the individual expenditure of local authorities on education was on the order of no more than 10 percent of the total public expenditure on education. We must take into consideration that a portion of this expenditure is needed to supplement salaries since the government does not cover all the expense of salaries for custodians, secretaries, teacher’s aides, social workers, psychologists, and others. Another portion is an expenditure of the local authorities for administration and implementation of the educational system since there is still about 6-7 percent that needs to be covered according to the data from the Central Bureau of Statistics.

To summarize: 6 to 7 percent of the public expenditure on education is no small amount, although its influence on inequality is minimal. Individual examples from any specific locale do not change the whole picture. The main part of the inequality stems from the overall government policies and so the majority of effort should be directed there if there is a wish to reduce gaps in education system inputs and outputs.

[1] It is noteworthy that part of the school fees in academic institutions are paid by employers or worker continuing education savings funds (keren hishtalmut) and so it is unclear whether these should be called private expenditure or not.

[2] The data in this table have been processed to simplify the presentation and is taken from Table 3 in the press release

[4] After 2012, household participation was greatly reduced following the recommendations of the Trajtenberg Committee to exempt parents from this payment.

[5] The bureau’s data regarding secondary schools include payments for boarding schools, teaching Hebrew as a second language and adult education as well as other educational services, where the classification of other educational services includes adult courses and continuing education. It appears that these items increase the portion of individual expenditure in secondary education.